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June 05, 2010

Barrick Gold has conquered some of the most inhospitable places on Earth to become the world’s biggest gold miner, but in Balochistan it may have bitten off more than it can chew.

Barrick and Antofagasta of Chile share an equal stake in Tethyan Copper Corporation (TCC), which acquired a 75 per cent interest in the Reko Diq copper deposit in a remote area of south-west Pakistan in 2002 from Australia’s BHP Billiton. The provincial government of Balochistan retained the other 25 per cent.

The company has spent millions developing Reko Diq, but Balochistan is renowned not just for the ferocity of its tribesmen, who are widely considered even more intimidating than the Pashtuns. It is also known for Gwadar, the deepwater port being built by the Chinese.

But the most significant copper-gold discovery in at least 20 years has led to a high-stakes battle between the two partners.

Barrick says it continues to work at the huge Reko Diq property and its exploration licence is still valid, despite the chief minister of Balochistan saying in February that the government was cancelling Barrick’s licence and planned to develop the site itself.

Reko Diq is said to contain at least 10 million ounces of gold and 5 million tonnes of copper, and is expected to become a major world mine for 50 years or more.

“We are having discussions with government officials there,” says Vince Borg, the Barrick executive vice president. “[But it’s still] not clear what their thinking is as we haven’t received any official notice regarding their intentions … but we remain hopeful that we can reach an agreement to move it along.”

Relations between TCC and Balochistan’s leaders have always been tense. At the time of the 2002 acquisition, many political, business and industrial leaders criticised the change of foreign ownership, says Syed Fazl-e-Haider, the Balochi development analyst in Karachi.

“According to the Balochistan government, TCC sold its 75 per cent interests to Barrack and Antofagasta without its consent,” Mr Fazl-e-Haider says.

TCC’s exploration licence is due to expire in February of next year, and later this year the Reko Diq feasibility study is expected to be released, confirming an enormous resource that will cost at least US$3 billion (Dh11.01bn) to develop.

TCC is now anxious to agree terms to secure a mining lease but as these critical milestones approach, distrust and anti-western sentiment is coming to the fore.

“We will not extend any further contracts, either to the existing companies or to anyone else,” Nawab Muhammad Aslam Khan Raisani, the chief minister of Balochistan, told the Financial Timesin February. “They only have an exploration licence, which does not cover extraction.”

Mr Fazl-e-Haider says Balochistan believes TCC has failed to live up to the terms of its exploration licence, which requires the company to build a mining academy and commit to an onsite smelter.

It will be difficult for Balochistan to obtain bank backing to develop Reko Diq without a major industrial partner and there are a limited number of credible alternatives to Barrick and Antofagasta, given Reko Diq’s location in this remote and often hostile area of Pakistan.

As well as its ferocious tribesmen, Balochistan is famous for a long-standing separatist movement, some resident anti-Iran militia and the Quetta shura, the leaders of the Afghan Taliban.

The area also falls within the Tethyan Magmatic Arc, a geologic structure that is one of the few remaining unexplored areas in the world, says a geologist working at the site who asked not to be identified. “This is a giant porphyry copper-gold deposit that is not really high grade, but the sheer size and scale of it make it remarkable,” he says.

The only remaining question is who will have the rights to mine it.

A possible alternative is the China Metallurgical Group Corporation (MCC), the state-owned mining giant that is already active in the area, operating the much smaller Saindak copper property. MCC is also developing the super-rich Aynak copper deposit in Afghanistan, 60km south-east of Kabul.

MCC secured both sites by paying above the odds and offering major ancillary projects. At Aynak, MCC promised a 400 megawatt power plant, an on-site smelter and a railway to Tajikistan that could open up the north of Afghanistan to central Asian trade routes linked to the transport centre of Kashgar, the western Chinese city.

Some have speculated that Reko Diq offers similar possibilities because it lies along a promising new trade route connecting Gwadar to the Pakistan capital city of Islamabad.

Gwadar is only 500km from the Strait of Hormuz and could allow China to transport its Gulf oil supplies overland into its western provinces. This would generate economic development that could help to settle those restive areas, while avoiding the long and increasingly hazardous sea route from the Gulf through the pirate-infested Strait of Malacca and South China Sea up to China’s east coast.

But Mr Fazl-e-Haider says MCC has also antagonised the Balochis, who accuse the company of increasing production at Saindak so aggressively that it has halved the life of the mine to 10 years.

He says MCC is doing the same thing at Aynak, where mine capacity is being built at 320,000 tonnes of copper concentrate a year compared with an agreed annual level of 200,000 tonnes.

MCC was not available for comment.

At the heart of the dispute is Balochistan’s determination to participate fully in the economic benefits of any natural resources extracted from its land.

Mr Raisani estimates total reserves at Reko Diq at a minimum value of $1 trillion, a number that is rising along with the gold price. “Even if we get $1bn a year out of this project, our economic returns for Baluchistan will improve very rapidly,” he told the FT. “But we are looking at much larger returns.”

Mr Borg says TCC continues to work on the project and remains “hopeful”.

“The technical side of the project is progressing along. The partners are reviewing/finalising feasibility study for the next several months,” he says.

“On the political side, we are having discussions with government officials there … I suspect, though, that this will take time.”

By Riccardo Perissich

The European process is based on compromises; when it comes to selling them to national electorates, countries behave differently. France feels compelled to declare victory; Germany has more often chosen to stress the concessions that it made, adding that they were painful but necessary for the sake of ‘Europe’. The reality is very different. In this new EuropEos Commentary, Riccardo Perissich, Executive Vice-President of the Council for the United States and Italy, describes that European reality, in unambiguous terms.

EuropEos is a multidisciplinary group of jurists, economists, political scientists and journalists set up in 2002 with the aim of creating an ongoing forum for the discussion of European policy and institutional issues. Successful collaboration between its members and CEPS has led to this series of EuropEos Commentaries. Visit:http://www.europeos.it/EuropeosWEB for more information.

This report presents a range of views on the future of Australia’s naval shipbuilding and repair industry.

ASPI asked a range of government and industry players for their views, and their responses form the first section of this report. Papers are by Andrew Davies, Defence Materiel Organisation (DMO), Defence SA Advisory Board, Defence Industry Unit of the Victorian Government, BAE Systems Australia, Austal Shipbuilding, Henry Ergas and Mark Thomson. Some common themes emerged: the challenge to develop the capacity to deliver the future, the need to manage the workflow for industry to avoid a ‘boom and bust’ pattern, and the need for Australian industry to be competitive in a global marketplace.

The second part of this report is a summary of a follow-on workshop discussion facilitated by ASPI in Canberra. The discussion included the possibility of a government-driven rationalisation of the local shipbuilding industry. The report captures the views of participants and ASPI provides some observations and recommendations.

Of all the great-power relationships of Asia, none is so difficult for Australia to influence as the relationship between India and China. Both are concerned primarily about their respective positions in a changing Asia. Our best strategy is to encourage both powers to temper their rivalry through their own efforts, and to attempt to put in place arrangements that might stop that rivalry from escalating into areas of greater importance to us—maritime areas in the northern Indian Ocean and western Pacific.

This week, a delegation from India's government arrived in Washington for the first-ever strategic dialogue between India and the United States. This was no routine meeting. It was the culmination of years of intensive engagement between our countries engagement that will grow even deeper as we confront the urgent global, regional and local challenges of this era.

India is the world's largest democracy, one of its fastest growing economies and a rising power in Asia and beyond. It has vibrant democratic institutions, a free press, robust civil society, an innovative private sector and tens of millions of citizens whose talents have yet to be fully realised. It is also a model of democratic development that has lifted millions of people out of poverty by widening access to the tools of opportunity education, healthcare, food, water and jobs.

India's rise is a defining storyline of early 21st century. And as President Barack Obama has said, India is an indispensible partner to the US. Given the complexity of the challenges we face and the values we share, the US-India partnership is critical to our mutual progress.

Through our strategic dialogue, we are expanding our cooperation on global issues on which India can and must play a leading role, including climate change, nuclear non-proliferation and food security. Already, India has taken important steps. Last year, it helped shape the Copenhagen Accord and pledged to lower its greenhouse gas emissions intensity by up to 25 per cent by 2020. During Prime Minister Manmohan Singh's visit to Washington in November, he and President Obama launched the partnership to advance clean energy, to bring Indian and American scientists together to develop and deploy technologies that reduce our dependence on fossil fuels.

Our nations are advancing global security by working together on counterterrorism and nuclear non-proliferation, building on the US-India civilian nuclear cooperation initiative. At the nuclear security summit in April, Prime Minister Singh announced that India will create a Global Centre for Nuclear Energy Partnership to train scientists from other countries in nuclear safety an important contribution to our common security and to achieving a world free of nuclear weapons.

India and the US are also working together on the challenge of global hunger and food insecurity. Fifty years ago, India's Green Revolution saved millions of lives and transformed India's economy. A similar transformation is needed today in other parts of the world, especially Africa. Indian and American scientists are developing new seeds and pesticides to boost crop yields, which will save lives and lift farmers' fortunes including in India's rural regions.

Meanwhile, India is as an anchor of stability and economic growth in Asia. Its leadership will be critical to solving regional challenges most urgently, securing Afghanistan's future. India, the US and countries worldwide have a stake in a stable Afghanistan. India has provided $1.3 billion in assistance to Afghanistan; India is building the new parliament building; and Indian and American groups are working together to help Afghan engineers bring 24-hour electricity to Kabul.

India is an Asian power, and a secure, prosperous Asia is critical to a secure, prosperous world. The US wants to work with India to create an open and inclusive regional architecture that makes it possible for all countries in Asia to rise and prosper. Toward that vision, we are called to promote trade, protect vital sea lanes and respond to natural disasters.

Apart from our cooperation on global and regional issues, the US also remains committed to a strong bilateral relationship with India, built on the ties that connect our governments, private sectors, civil societies, universities and citizens.

One example is education. More than 1,00,000 Indian students study in the US. We want an equal number of Americans to study at Indian universities, and for the educational partnerships between our nations to expand. To that end, we have nearly tripled the number of Fulbright-Nehru Fellowship scholars during the last two years. The new Obama-Singh 21st Century Knowledge Initiative will build partnerships between Indian and American universities. And India is now poised to undertake a significant educational reform: allowing foreign universities to open campuses in India.

Our economic and financial partnerships are also growing, helping India move closer to its development goals. To deepen these ties, Washington and New Delhi are called to emulate the entrepreneurial spirit of Manhattan and Mumbai by reducing barriers to trade and investment, which will open markets and create jobs in both countries.

The relationship between India and the US goes back generations and has enriched the lives of millions of our people. Today, our partnership of democracies is shaping the world of the 21st century. Together, we can achieve great things for our citizens and for people everywhere. This is our opportunity and our responsibility.

BANGKOK - Myanmar's ruling generals have started a secret program to develop nuclear weapons and ballistic missiles to deliver them in a high-stakes bid to deter perceived hostile foreign powers, according to an investigative report by the Democratic Voice of Burma that will be aired later on Friday by television news network al-Jazeera.

conducted by international arms experts and others during the report's five-year production. In the strategic footsteps of North Korea, Myanmar's leaders are also building a complex network of tunnels, bunkers and other underground installations where they and their military hardware would be hidden against any external aerial attack, including presumably from the United States.

Based on testimonies and photographs supplied by high-ranking military defectors, the documentary will show for the first time how Myanmar has developed the capacity and is now using laser isotope separation, a technique for developing nuclear weapons. It will also show how machinery and equipment has been acquired to develop ballistic missiles.

That Myanmar is now trying to develop nuclear weapons and has become engaged in a military partnership with North Korea will dramatically change the region's security dynamic. Myanmar is a member of the Association of Southeast Asian Nations (ASEAN), a 10-nation grouping whose members jointly signed the 1995 Southeast Asian Nuclear-Weapon-Free Zone Treaty, also known as the Bangkok Treaty.

The nuclear bid will also put the already diplomatically isolated country on a collision course with the US. US Senator Jim Webb, who has earlier led a diplomatic drive to ''engage'' the junta, abruptly canceled his scheduled June 4 trip to Myanmar when he learned about the upcoming documentary. The explosive revelations about Myanmar's nuclear initiative are expected to freeze Washington's recent warming towards the generals.

It is possible that the junta's grandiose schemes could amount to little more than a monumental waste of state resources. According to one international arms expert familiar with the materials on Myanmar's program, the laser isotope separation method now being employed by Myanmar's insufficiently trained scientists ''is probably one of the worst that is yet to be invented. The major countries of the world have spent billions of dollars trying to make the process work without success.''

There is thus a risk that the generals will further undermine the country's already wobbly economic fundamentals on ill-conceived weapons projects, ones that may yield little more than lots of radioactive holes in the ground and some crude Scud-type missiles.

Western military experts assert that any sophisticated bunker-buster bomb could easily penetrate the newly built network of tunnels and other underground facilities, constructed near the new capital of Naypyidaw. In light of the country's lack of technical know-how, Myanmar's desired nuclear bomb may also turn out to be a huge white elephant. It is not even certain that its homegrown missiles will fly. At least that is the conclusion of weapons' experts who have closely examined the materials that will be presented in al-Jazeera's investigative report.

The program was produced over five-years by the Democratic Voice of Burma, or DVB, a Norway-based radio and TV station run by Myanmar exiles. They have made their case based on leaked photographs, documents and testimonies from key military defectors. The documentary was directed by London-based Australian journalist Evan Williams.

Nuclear turncoatThe report's main source, Sai Thein Win, is a former Myanmar army major who recently defected to the West, bringing with him a trove of information never seen before outside of the country. His documentation has been scrutinized by, among others, Robert Kelley, a former US weapons scientist at the Los Alamos facility where work is conducted towards the design of nuclear weapons.

From 1992 to 1993 and 2001 to 2005, Kelley also served as one of the directors of the International Atomic Energy Agency (IAEA). "Sai Thein Win reminds us to some degree of Mordecai Vanunu, an Israeli technician at the Dimona nuclear site in the Negev desert ... Sai is providing similar information," said Kelley.

Vanunu blew the whistle on Israel's nuclear program, and, according to Kelley, Sai Thein Win has "provided photographs of items that would appear to be very useful in a nuclear program as they are specific to nuclear issues. They could be seen as for other things, but they look like they were designed for a nuclear program."

Geoff Forden, another international arms expert, says Myanmar appears to be "pursuing at least two different paths towards acquiring a missile production capability. One is a more or less indigenous path. The less indigenous comes from the fact that they have sent a number of Myanmar military officers to Moscow for training in engineering related to missile design and production."

Sai Thein Win was among the Myanmar army officers sent to Russia and he has produced photographs of himself taken during his training there. He also has pictures of a top secret nuclear facility located 11 kilometers from Thabeikkyin, a small town near the Irrawaddy River in northern Myanmar.

He claims this is the headquarters of the army's nuclear battalion and that it is there the regime is trying to build a nuclear reactor and enrich uranium for weapons. Missile development, he says, is carried out at another facility near Myaing, southwest of Mandalay, in central Myanmar.

Machinery for the Myaing plant has been supplied by two German firms, which also sent engineers to install the equipment. The Germans, Sai Thein Win says, were told that "the factories were educational institutions ... those poor German engineers don't know, didn't know that we were aiming to use those machines in producing rocket parts or some parts for military use."

How useful those machines will be for missile development is questionable. Despite their training in Russia, the Myanmar engineers handling them have little or no knowledge of producing sophisticated weapons, according to experts who say the generals' apparent dream of having a nuclear reactor may also be just that: a pipedream.

Another high-ranking Myanmar military official also provided DVB's researchers with classified information related to the country's nuclear and missile program. He, however, fell out of view while in Singapore some time last year and his current whereabouts is now unknown.

Myanmar was one of the first countries in the region to launch a nuclear research program. In 1956, the country's then-democraticgovernment set up the Union of Burma Atomic Energy Center in the former capital Yangon. Unrelated to the country's defense industries, it came to a halt when the military seized power in 1962. The new military power-holders, led by General Ne Win, did not trust the old technocrats and saw little use in having a nuclear program designed for peaceful purposes.

In 2001, Myanmar's present ruling junta aimed to revitalize the country's nuclear ambitions. An agreement was signed with Russia 's Atomic Energy Ministry, which announced plans to build a 10-megawatt nuclear research reactor in central Myanmar. That same year, Myanmar established a Department of Atomic Energy, believed to be the brainchild of the Minister for Science and technology, U Thaung, a graduate of the Defense Services Academy and former ambassador to the US. At the time, US-trained nuclear scientist Thein Po Saw was identified as a leading advocate for nuclear technology in Myanmar.

Reports since then have been murky, including speculation that the deal was shelved due to Myanmar's lack of finances. The Russian reactor was never delivered, but in May 2007 Russia 's atomic energy agency, Rosatom, again announced it would build Myanmar 's nuclear-research reactor. Under the initial 2001 agreement, Myanmar nationals, most military personnel, were sent to Russia for training. Nearly 10 years later, Russia has yet to deliver the reactor because Myanmar "refused to allow inspection by the IAEA", according to DVB.

North Korean allyMyanmar thus appears to have embarked on its own indigenous program to build a nuclear research reactor. Unconfirmed reports circulated on the Internet claim that North Korea is assisting the Myanmar authorities in the endeavor. Diplomatic relations between North Korea and Myanmar, which were severed in 1983 when North Korean agents detonated a bomb in Yangon, were officially restored in April 2007.

Only days later, a North Korean freighter, the Kang Nam I, docked at Thilawa port near the old capital. Heavy crates were unloaded under strict secrecy and tight security. A journalist working for a Japanese news agency was detained and interrogated for attempting to photograph the unloading.

Last year, the Kang Nam I was back in the news when, destined for Myanmar, it was turned back by US naval warships. At the time, it was thought to be carrying material banned under UN Security Council resolutions aimed at preventing North Korea from exporting material related to the production and development of weapons of mass destruction (WMD).

North Korea's role in Myanmar 's nascent nuclear program is still a matter of conjecture. But in May this year, a seven-member UN panel monitoring implementation of sanctions against North Korea said its research indicated that Pyongyang is involved in banned nuclear and ballistic activities in Iran, Syria and Myanmar.

The experts in the documentary said they were looking into "suspicious activity in Myanmar", including the presence of Namchongang Trading, one of the North Korean companies sanctioned by the UN. North Korean tunneling experts are also known to have provided crucial assistance to the construction of Myanmar's underground facilities.

According to an unnamed Myanmar army engineer, who was also interviewed for the DVB documentary, "a batch of eight North Koreans came each time and [were] sent back, [then] another eight came and were sent back. At the Defense Industry factories, there are at least eight to 16 of them ... they act as technical advisers."

In November 2008, Gen Shwe Mann, the third-highest ranking official in Myanmar's military hierarchy, paid a secret visit to Pyongyang. Traveling with an entourage of military officers, he visited a radar base and a factory making Scud missiles, and signed a memorandum of understanding with the North Koreans to enhance military cooperation between the two countries.

A photo file and other details of the visit were leaked to Myanmar exiles and were soon available on the Internet, prompting the authorities to carry out a purge within its own ranks. On January 7 this year, one Foreign Ministry official and a retired military officer were sentenced to death for leaking the material.

Military insecurityAung Lin Htut, a former intelligence officer attached to the Myanmar Embassy in Washington until he defected in 2004, claims that soon after General Than Shwe came to power in 1992 he "thought that if we followed the North Korean example we would not need to take into account America or even need to care about China. In other words, when they have nuclear energy and weapons other countries ... won't dare touch Myanmar."

The tunnels and bunkers - some of which are large enough to accommodate hundreds of soldiers - should be seen in the same light, Aung Lin Htut has argued. "It is for their own safety that the government has invested heavily into those tunnel projects," he said.

The generals may fear not only an outside attack, which is highly unlikely according to security experts, but also another popular uprising. In 1988, millions of people took to the streets to demand an end to military dictatorship. In 2007, tens of thousands of Buddhist monks led marches for national reconciliation and a dialogue between the military government and the pro-democracy movement.

On both occasions, the generals responded with military force and brutally suppressed the popular movements. But the generals were shaken and apparently saw the need to move themselves and vital military facilities underground and away from populated areas, as also seen in the junta's bizarre and sudden move to the new capital Naypyidaw in November 2005.

For other reasons, North Korea reacted similarly after the war on the Korean Peninsula. North Korea is believed to have one of the world's most extensive complexes of tunnels, storage facilities - and even weapons' factories - all hidden from the prying eyes of real and imagined enemies.

That is likely why Myanmar's generals see Pyongyang as a role model and why relations between the two countries have warmed since the 1990s - hardly by coincidence at the same time the US has become one of Myanmar's fiercest critics. In 2005, then-secretary of state Condoleezza Rice branded Myanmar, along with Belarus, Cuba, North Korea, Iran and Zimbabwe as "outposts of tyranny", and the US tightened financial sanctions against the regime and its supporters.

The present US administration of President Barack Obama adopted a more conciliatory approach, sending emissaries to Myanmar to "engage" the generals and nudge them towards democracy. But sources close to the decision-making process in Washington also believe that concern over Myanmar's WMD programs - and increasingly close ties with North Korea - should be equally important considerations in any new US policy towards Myanmar.

One of the negotiators recently sent to Myanmar, US Assistant Secretary of State for East Asia Kurt Campbell, is interviewed in the DVB documentary. When asked about Myanmar's new security-related polices and initiatives, he replies rather cryptically:

Some of it is sensitive so really can't be discussed in great detail, but I will say we have seen enough to cause us some anxiety about certain kinds of military and other kinds of relationships between North Korea and Burma [Myanmar]. We have been very clear with the authorities about what our red lines are ... we always worry about nuclear proliferation and there are signs that there has been some flirtation around these matters.

According to internal documents presented by the DVB, the total cost of Myanmar's tunneling projects and WMD programs is astronomical, running into billions of US dollars. This appears to be one reason why several Myanmar military officers have defected to the West - and brought with them the evidence that will be seen by global audiences on Friday.

Bertil Lintner is a former correspondent with the Far Eastern Economic Review and the author of Great Leader, Dear Leader: Demystifying North Korea Under the Kim Clan. He is currently a writer with Asia Pacific Media Services.

Following 5 Mantras and 10 Commandments have been enunciated for the future US Administrations so that they do not blunder yet again in making wrong and self-defeating strategic choices vis-à-vis India. Though not proposed as benchmarks, these will become de facto benchmarks to judge future US behavior towards India. If the US policy planners and government officials adopt and internalize the proposed 5 Mantras and 10 Commandments, the relationship between the two great democratic nations would be smooth. The future Indo-US relationship will be predicated on the following bench-marks:

Five Mantras:

India is a re-emerging superpower that cannot be stopped!

India is a pluralistic democracy.

India is an ancient civilization that is proud of her glorious past, aware of her current limitations and fully cognizant of her future potential, roles and responsibilities.

India cannot be contained as she shall not bow or bend.

India shall prevail over all the adversities with resilience.

Ten Commandments:

Thou shall not interfere in the internal affairs of India.

Thou shall not block India’s entry into the P5.

Thou shall not spy on India.

Thou shall not expect India to change her independent foreign policy.

Thou shall not place trade restrictions and visa obstructions in the path of Indian scientists and professionals who provide important services.

Thou shall not send Evangelist, Baptist, Christian missionaries to India under garb of tourists and CIA agents under the garb of journalists.

Thou shall express sincere apologies for “breach of a bilateral contract between two sovereign nations” on Tarapur Atomic Power Station (TAPS) and make amends for the same.

Thou shall not prop up serial military dictatorships of Pakistan on one pretext or another.

Thou shall not play the China card against India.

Thou shall not act as the policeman of the Indian subcontinent.

April 6, 2008

Dr. Adityanjee is the President of Council for Strategic Affairs, New Delhi

June 04, 2010

(Note: At the risk of making this an all-Jeff-Welgan blog, I thought this week I would cover Jeff's thesis work on the effects of labels on analysis right on the heels of last week's discussion of his work embedded in the new book, Hyperformance).

Does a name matter? Shakespeare says, "No, a rose by any other name would smell as sweet" but most psychologists would disagree. The well known "framing effect" shows that the way a question is asked can determine how people will answer it. Likewise, psychological campaigns aimed at dehumanizing an enemy often accompany wars.

Jeff Welgan, in his thesis called, The Effects Of Labels On Analysis, tests these ideas in the realm of intelligence analysis. Some of you may remember taking Jeff's survey last year. In it, he presented a fictitious scenario set in the Horn of Africa. Each participant was asked to read an identical report of an activity. The only thing that changed was the word used to describe the group conducting the activity. Specifically, Jeff tested the words "group", "insurgent", "rebel", "militia", or "terrorist". He hypothesized that the specific word used would affect the analytic conclusions that participants would draw.

Jeff did not aim his study at a random sample of the general population, however. He took pains to engage analysts in the national security realm, in law enforcement or in business. The results in the image to the right are self-reported (the inevitable cost of a web-based survey...) but he was fairly careful in his approach to getting participants. In all, some 233 of you participated in the experiment (Many thanks!).

Despite his hypotheses, it was unclear what he would actually find. These psychological biases are deep-seated and robust but, on the other hand, there is good research to suggest that credible evidence helps overcome framing issues and intel analysts are typically trained to be on the lookout for sources of bias. As Jeff stated, "My thesis will examine to what extent the quality of analysis is at risk, if it is indeed at risk, as the differing connotations of these labels would suggest."

In the end, the labels wound up making little difference for trained intel analysts. As Jeff bluntly stated, "My hypothesis that these particular labels have significant meaning, and many individuals have a preconceived idea, or cognitive biases, regarding the kinds of actions each of these particular groups conduct must be rejected at this time due to an overall lack in statistical significance across the labels."

This is clearly good news for the intel community at large. It certainly suggests that at least some of the training to defeat at least some of the cognitive biases is working.

The full text of the thesis is below or can be downloaded from Scribd.com.

ABSTRACT

This thesis examines the notion of cognitive bias as it relates to intelligence analysis. Specifically, it reports the findings of an online experiment in which analysts in the field were given a mock intelligence report featuring one of five labels for hostile groups— either ‗group,‘ ‗insurgent,‘ ‗rebel,‘ ‗militia,‘ or ‗terrorist‘—and then the analysts were asked to complete a survey of questions regarding their impressions of the likelihood, severity, and sophistication of an attack if one were to occur. The overall findings resulted in no statistical significance, though statistical significance was discovered to be present for certain labels and certain questions. What this means for the intelligence community is that more research is needed before conclusive results can be determined. If cognitive bias plays a role in intelligence analysis, it could have implications for the way in which intelligence reporting is done. Regardless, intelligence analysts are trained to be precise, accurate, and as unbiased as possible, and this is a goal of which analysts must continuously be conscious and for which analysts must constantly strive.

The sudden resignation of Japan's Prime Minister will trigger a period of political jostling among ruling party legislators as they struggle to find a new leader ahead of a mid-term election for the Upper House of parliament due next month.

IHS Global Insight Perspective

Significance

Japanese prime minister Yukio Hatoyama announced his resignation today after less than nine months in office.

Implications

Since rising to the leadership position last September, Hatoyama gained a reputation as weak and indecisive, reinforced by his dithering and eventual backtracking on the relocation of a U.S. military base on Okinawa, his involvement in an embarrassing political-funding scandal, and his failure to meet a number of other ambitious campaign pledges.

Outlook

While his resignation will not result in a change of government—the Democratic Party of Japan still retains a majority in both the Upper and Lower houses of the Diet—it deals a damaging blow to the party, which was elected to power amid strong expectations that a new brand of politics would be initiated in the country.

Japanese Prime Minister Resigns

Japan's Prime Minister Yukio Hatoyama announced his resignation today, just nine months after a landslide election victory, forcing the ruling Democratic Party of Japan (DPJ) to find a new leader before a crucial election to the Upper House of the Diet in early July. Hatoyama said that he was resigning over his broken campaign promise to relocate a U.S. marine base off the southern island of Okinawa as well as an embarrassing political-funding scandal involving his mother. Until last night, the Prime Minister had insisted that he would cling on while holding intermittent talks with senior party members. But in the end, he announced his decision at a special meeting of DPJ legislators, apologising "for causing enormous trouble" and acknowledging that his government had been unable to satisfy the public. The Prime Minister also requested that Ichiro Ozawa, the DPJ Secretary-General previously linked to a donations scandal, step down with him in order to create "a fresh and clean DPJ". The Prime Minister had been under increasing pressure to step down from within his own party over the past week after several opinion polls showed his support plummeting to below 20%. The calls from within the DPJ for him to step aside had also increased ahead of an important election this summer which is viewed as a referendum on the party's first year in government.

Futenma Highlights Hatoyama's Incompetence

Hatoyama won power last year with promises to revive Japan's economy, rein in the power of the cumbersome bureaucracy, and fundamentally improve relations with the United States. But in the end, his administration became bogged down by the issue of the relocation of the Futenma airbase on the southern island of Okinawa as well as the dubious political financing of the party. To a significant extent, his popularity plummeted due to his lack of decisiveness as his administration wasted several months sending out contradictory signals to the Japanese electorate over plans to move the military base. Indeed, one of Hatoyama's key election pledges last year had been to review a 2006 pact with the United States to relocate the locally unpopular U.S. military facility within Okinawa Island, and to instead transfer it off the island or even outside the country. He promised to do this to reduce the burden on the local Okinawan population who have long resented the pollution and safety hazards associated with living alongside a heavy military presence. But after months of searching for an alternative location, the Prime Minister backtracked, taking the decision to keep the facility on the island. The news infuriated Okinawans and caused the country's fragile governing coalition to disintegrate, as the left-leaning Social Democratic Party (SDP) withdrew from the group after the Prime Minister dismissed its leader, Mizuho Fukushima, from her cabinet position. Fukushima's dismissal ironically enhanced her public standing as a politician who had the courage of her convictions, while reinforcing the perception of Hatoyama as inept and vacillating.

Corruption Taints Ruling Party

Hatoyama's fate was also sealed by corruption sandals after he was linked to fundraising improprieties by an aide. Specifically, the Prime Minister's mother was alleged to have made large donations to his electoral coffers, which sparked a criminal investigation that resulted in a suspended jail term for one of his close aides. The scandal was particularly damaging to the new government as it fed into pre-existing public malaise over the ongoing presence of Ozawa within government. Otherwise known as the "Shadow Shogun", Ozawa was the political mastermind behind the stunning electoral win last August which put an end to nearly half a century of Liberal Democratic Party (LDP) rule. However, his reputation had already been seriously undermined when three of his current and former aides were indicted for cooking the books prior to elections last year. Both affairs badly undermined the DPJ's positioning as a credible, clean alternative to the LDP, calling for a fresh start in Japanese politics.

Weak Economic Policy

Perhaps an equally important factor leading to Hatoyama's demise may have been the country's precarious fiscal position combined with ballooning levels of public debt. While this issue was largely inherited from the previous administration, the Hatoyama government came under growing criticism for its refusal to move away from the country's massive fiscal spending—spurring worries of a possible Greek-style financial collapse in the future. The DPJ also failed to meet several other promises, including eliminating highway tolls and finding sufficient funds to finance cash allowances for families with children.

Outlook and Implications

Potential Successors

In the wake of Hatoyama's resignation, the party plans to vote for a new leader on Friday (4 June), with Finance Minister Naoto Kan appearing to be the clear front-runner in the leadership contest. Kan is highly regarded for his success as Health Minister in 1996, when he exposed a government cover-up of HIV-tainted blood products that resulted in thousands of haemophiliac patients contracting AIDS. Having been Hatoyama's right-hand man, he was appointed for his hard-line stance towards the bureaucracy, tasked with wresting power from the body over policy and budgetary processes. Kan, 63, is also known for his sharp tongue, debating skills, and short temper. Other potential successors include Foreign Minister Katsuya Okada, Transport Minister Seiji Maehara, and Deputy Finance Minister Yoshihiko Noda.

Ensuing Policy Uncertainty

Meanwhile, Hatoyama's sudden resignation creates uncertainty over the prospects for the implementation of an agreement to transfer the U.S. military base in Okinawa, raising questions over the recent pact to stick to the 2006 agreement with the Washington government. It also remains unclear whether his successor will be equally keen to establish closer relations with China and other Asian countries, as Hatoyama pushed the idea of an "East Asian" community. The decision could also result in the postponement of key announcements on economic policy, causing delays in the scheduled releases this month of the Tokyo government's growth strategies and fiscal targets.

Dimming Electoral Prospects?

Hatoyama's resignation will not result in a change of government, because the DPJ retains a commanding majority in Parliament's Lower House, which chooses the Prime Minister, meaning they are likely to remain the ruling party at least until the next general election in 2013. Meanwhile, the opposition LDP remains in tatters after last year's severe electoral drubbing. Badly affected by factional infighting and a spate of high-profile defections, the party harbours little prospect of returning to power. However, the Prime Minister's sudden decision to step down deals a damaging blow to the ruling party. Hatoyama came to power promising a new brand of politics and his resignation after less than a year will be seen as a betrayal, justifying widespread doubt over the degree of concrete political change that the new government actually represents. More generally, Hatoyama is the fourth Japanese prime minister to resign since 2007, which is likely to trigger some soul-searching over the country's inability to produce an effective leader, while fuelling worries that Japan's stagnant politics is preventing it from reversing years of economic decline. The country's 20 years of slow growth have long been blamed on the lack of a strong leadership able to formulate an effective political and economic agenda. Looking ahead, while the DPJ fails to carry out the kind of deep and wide-ranging reform that the country actually wants, political malaise among the populace will continue to build, a reminder of how much change Japan needs to undergo in order to achieve an effective and democratic political system.

The parliamentary elections in Iraq have once again lent currency to the notion of ‘a Shia Crescent’—and its geopolitical implications—in order to poison public opinion in the Middle East. In 2004, when for the first time King Abdullah of Jordan warned about the formation of a Shia Crescent –which he claimed consisted of Iran, Iraq, Syria, and Lebanon- he was looking to receive more than remarks of support from Egyptian President Husni Mubarak and the Wahhabi clerics of Saudi Arabia. The failure to realize his goals signifies the shrewdness of Middle Eastern public opinion—against the will of regional and extraregional supporters of a ‘Shia-demonization’ project.The geopolitical state of Shias is an incontrovertible fact, but can it in anyway undermine the geopolitical position of the Sunnis? No reasonable political mind can argue that a 10% percent minority can extend its hegemony over a powerful majority. Always a minority throughout the history of Islam, Shias have also always preferred interaction and unity to hegemony as the only way to survive. As much as the concept of a ‘Shia Crescent’ should not foster a sense of false pride for ordinary Shias, it must not also cause concern for unsophisticated Sunnis. Those who exaggerate the power of a so-called Shia Crescent are actually trying to bring to the fore religious contrasts and challenges, materialize them in the socio-political arena, and ultimately bring them into the field of diplomacy. Diversity –particularly in faith- has never been absent in any community. Civil societies should regard such differences not as a threat, but as an opportunity to cross-fertilize theories and philosophies.

Hot debates over the increasing power of a ‘Shia Crescent’ aim to fuel tensions between the Shias and the Sunnis. Ironically, those Western countries that support the idea have witnessed –and engaged in- the most atrocious battles over religion before beginning to seek unity. On the other hand, at no point in its 1400-year history has the Muslim World engaged in sectarian battles and conflict comparable to the ones Catholics and Protestants have suffered for centuries.

Incidents such as the September 11 terrorist attacks and a U.S. attitude shift –from interaction to confrontation with Salafism - and a tilt in the balance of power in favor of the Shias of Iraq after the fall of Saddam, impelled King Abdullah of Jordan to coin the misleading term ‘the Shia Crescent’. And the West is dishonestly taking advantage of this newly formed concept to foment the rift between Muslims.

Iran -dubbed as the mastermind of this imaginary crescent- has time and again proven that it regards the unity of the Muslim World far more crucial than supporting the Shia population around the globe. Two examples are Iran’s proclamation designating the last Friday of Ramadan as Quds Day, and the price it had to pay when it backed both the Shia Hezbollah of Lebanon and the Sunni Hamas of Palestine. But for developers of such theories these are facts that should be ignored.

Overall, one-dimensional geopolitics neither exists nor is useful for any state. It is clear that Iraq prioritizes Arab identity over its Shia-identity majority. Policies followed by the Iraqi government towards the correct usage of the term ‘Persian Gulf’ and its approach regarding the three Iranian islands of the Persian Gulf claimed by the United Arab Emirates, are clear evidence of that. Simply limiting Iran to Shia geopolitics deprives it from access to a potential sphere of influence where the majority of dwellers are Sunnis.

It seems that behind the concept of the Shia Crescent, more than religious concerns, lies a fear of democracy in Iraq and its institutionalization—a potential threat to the authoritarian regimes in the Middle East.

Islam is intertwined with the identity of the Middle East. Serious promotion of democracy in the Middle East -while safeguarding the right of religious and ethnic minorities- could liberate Sunnis from the tyranny of their rulers. With the emergence of democratic governments in the Middle East, the Shia and Sunni will find more room for interaction. And as such, the concept of ‘The Shia Crescent’ is just a myth.

Turkey no longer wishes to remain a minor state. Interview with Mir Mahmoud Musavi, Iran’s former ambassador to Islamabad.IRD: A radical shift has occurred in Ankara’s foreign policy since Ahmet Davutoglu was appointed as foreign minister in Recep Tayyip Erdogan’s second cabinet. What is behind this policy shift?

MM: During the rule of the Justice and Development Party, minimizing tensions with neighbors has been Ankara’s first and foremost concern. At the level of state leaders –and I mean the prime minister and the president- the government has heavily stepped up its diplomatic interaction. The Turks have been quite active in realigning their foreign policy, shifting toward a realistic foreign framework, and mending some old fences.IRD: Some diplomatic observers say these developments are merely tactics, not a clear-cut strategy. As a typical case in point, they always refer to Israel-Turkey ties, which have been more or less cold within the past few years. Bearing in mind that the Turkish Army is still a powerful political actor, and is also not on good terms with the Islamist Justice and Development Party, do you see a future for these policies?

MM: I have no concrete answer for that at the moment. Overall, their advantages –and not Islamic ideology- determine whether such policies will continue or not. Erdogan’s diplomatic initiatives have been more or less supported by the Turkish media so far.

As is evident, Ankara is trying to follow a middle road in Middle Eastern affairs. To give a short historical perspective, Turkey was one of the first countries in the region to acknowledge Israel since its illegitimate establishment in 1948. Ankara’s ties with the West, its membership in NATO, Ataturk’s macropolicies and secularism, all push Turkey closer Israel.

During recent years Turkey has of course tempered its support for Israel. Despite continuing to maintain its relations with Tel Aviv, Ankara has also resolved its longstanding issues with Syria and other regional states, and revitalized ties with other Muslim countries.

Turkey has also brokered open and backstage negotiations between Israel and Syria (although Israeli politicians believe that during recent years Turkey has been giving Arab and Muslim countries preferential treatment). During the last two years, Israel has gradually lost its trust in Turkey as Ankara has drifted away from their cozy relationship. Turkey no longer permits Israel to use its air space. And the recent Israeli military attack on the human rights groups’ Gaza flotilla, causing civilian Turkish deaths on a Turkish-flagged vessel, will certainly aggravate tensions.

In diplomacy, Erdogan has been an over-achiever, as many experts would admit. But we are talking about Turkey—a country that has had its fair share of military coups against civilian governments. So there are no guarantees the current policies will continue in future. If a civilian administration stays in power, however, Erdogan’s regional and international policies will most likely continue.IRD: From Russia and Georgia to Afghanistan, Pakistan, and the Middle East, Turkey is trying to serve the role of an honest broker. How do you see Ankara’s efforts in becoming an influential international actor?

MM: Turkey no longer wishes to remain a minor state. The minimum demand of Turkish statesmen –as understood from their remarks- is that they want to become a powerful regional actor. But in a bigger picture, Ankara is seeking a global role. Close ties with the EU and the U.S., its geopolitical position, population, and economic strength; its influence in Central Asia and Caucasia, and its warm relations with Persian Gulf states, all fuel Ankara’s ambitions to become a global actor. Turkey is trying to take the utmost advantage from these potentials to rise as a new international power. This may seem a distant goal, but Turkey is taking the necessary steps.IRD: With the foothold Turkey has found in Iran’s nuclear case, the balance between Iran and the West has been affected. How will Turkey’s engagement with Iran’s nuclear program influence its diplomatic state of affairs in the future?

MM: Turkey’s main reason for entering negotiations over Iran’s nuclear program is to serve its own national interests. Like other brokering efforts, Ankara’s action serves its ambition to play a more active role in regional and international affairs. The Turks, meanwhile, count on their trade partnership with Iran. They plan to become a regional energy hub as Russia and Iran -their neighbors- possess some of the largest natural gas resources in the world. Ankara knows that the Nabokov project will have no future without Iran’s participation. If another round of UN sanctions targeting Iran passes, Turkey’s economic interest will be affected.

Ankara is trying to keep both Tehran and Washington satisfied with its policies. However, there are serious doubts about the real impact of its engagement –along with Brazil’s- with Iran’s nuclear case. Against the efforts of pro-Iran Turkey and Brazil, there are more powerful countries trying to hamper Iran’s nuclear program through the wielding of international institutions such as the IAEA and the United Nations Security Council.

June 03, 2010

In deficit to the tune of €430 million in 2009, NATO has serious budgetary difficulties, according to information gleaned by Intelligence Online. The organisation’s problems are so great that reforming the way it administers its finances has become a priority. Spending on all fronts - At the beginning of 2010, the Spanish General Alvaro Pino Salas was taken off the job as President of NATO ’s Senior Resources Board, which handles an annual budget CLICK TO READ MORE

We live in a world where global data transfers are presented as a norm; just part of life. It is when the individual’s right to privacy is overridden by the state’s appreciation of a need to know about that individual that problems arise. In this Policy Brief of the Justice & Home Affairs INEX series, CEPS Senior Research Fellow Elspeth Guild considers such questions as: what are the principles of privacy? What is necessary in a democratic society and what is the role of supranational and national courts in determining the meaning of privacy, and for whom?

The INEX project looks at converging and conflicting ethical values in the internal/external security continuum in Europe, and is funded by the Security Programme of DG Enterprise of the European Commission’s Seventh Framework Research Programme. For more information visit:www.inexproject.eu

As Saakashvili’s Party Lands a Key Win at the Local Elections, Moscow May Have to Stop Banking on a Change of Georgian Leadership and Rethink Its Policy

Georgia’s first elections since the 2008 war with Russia yesterday delivered the party of Georgian President Mikheil Saakashvili a key victory, which is likely to anger Moscow. Since the August conflict the Kremlin has always distinguished between the “discredited” Saakashvili administration and former Soviet Georgia proper. As Saakashvili’s party triumphs unambiguously in elections that were deemed to be more or less fair, Russia may have to rethink its tact. Moreover, Saakashvili’s entourage looks set to stay, and that means something will have to give before any normalization of relations appears on the horizon.

The final results of Georgia’s May 30 municipal elections were released yesterday, confirming that Saakashvili’s United National Movement (UNM) party had swept to victory with 66 percent of the vote. The UNM’s Gigi Ugulava also took the seat of Tbilisi mayor, a key political stronghold, seeing off opposition from former Ambassador to the United Nations Irakli Alasania, the main challenger to the UNM, Georgia’s ruling party.

The vote was seen as a litmus test of public feeling toward Saakashvili, and yesterday’s results bode very well for the UNM’s candidate for the 2013 presidential elections when Saakashvili must step down a decade after he came to power in the Rose Revolution of 2003. The new Tbilisi mayor, Ugulava, has been tipped to succeed Saakashvili.

The elections “marked evident progress toward meeting international standards,” a press release from the Organization for Security and Cooperation in Europe (OSCE) said, but stressed that “significant shortcomings remained.” Overall, elections were “transparent,” although “systemic irregularities” were still observed in some regions, including “several cases of ballot stuffing.”

“There were some minor discrepancies, but then again perfect elections in the post-Soviet space are impossible,” said Alexander Rondeli, an analyst at the Tbilisi-based Georgian Foundation for Strategic and International Studies. “This is a victory for Saakashvili. These elections show that many people are for the leading party and Saakashvili personally.”

The flamboyant and brash Georgian president has faced political pressure domestically since the “five-day” war from a lively but fractious opposition, whilst also getting less backing internationally. Since the Barack Obama administration came to power in the United States just over a year ago Georgia has found itself isolated, as Washington hit the reset button with Moscow. Saakashvili fell further out of favor in the West in March of this year amid allegations that he was behind a fake news report broadcasted on national television, purporting to show Russian troops advancing into Georgian territory.

Meanwhile, Russia has openly courted the Georgian opposition. Nino Burdjanadze, a vocal critic of Saakashvili’s conduct during the five-day war, came to Moscow in early March to establish “political dialogue” with Russia. She met Russian Prime Minister Vladimir Putin and looked good when Russia subsequently reopened the Verkhny Lars border checkpoint between the countries only days later.

Nonetheless, Saakashvili’s strong performance in local elections sends a defiant message. “Two months ago people were talking about the possibility of the opposition forces winning the elections. It turns out they could do nothing. These last elections in Tbilisi prove that Saakashvili’s team is a strong one,” said Alexei Malashenko, a Caucasus expert for the Carnegie Moscow Center.

This year Moscow has watched happily as the clock turned back on the Color Revolutions, as pro-Russian President Viktor Yanukovich was elected in Ukraine in February and Roza Otunbayeva was swept to power amid chaos in Kyrgyzstan. Several CIS states, particularly Belarus, were riled by what they perceived as a Russian hand in the recent unrest in Bishkek. Russia was suspiciously rapid in its recognition of the new government and Vladimir Putin himself spoke to Otunbayeva in the immediate aftermath of the violence.

But yesterday’s results show that Georgia’s opposition is too weak to serve any purpose for Moscow. “Miss Burdjanadze and another Russian protйgй, former Foreign Minister Zurab Nogaideli, they do not have much support. I don’t think they will be very valid in the future as an instrument to get rid of Saakashvili,” said Rondeli.

But Malashenko believes that this isn’t the only reason Russia is unable to shape political developments from afar. “Four years ago in Moscow they could have thought about trying to restore the old regime. But now that is impossible. Georgia is becoming a new country. That doesn’t mean it will be completely successful. It is just something else,” said Malashenko.

For that reason Georgia cannot be compared with Ukraine and Kyrgyzstan, where Russia still wields influence, he said: Georgia has already become “more modern and more normal, in spite of Saakashvili’s tricks.” “I think Moscow finally will change its policy with Georgia because they have begun to understand that Georgia is a special case,” he said.

UNM’s performance at the local elections has shaken one of the main tenets of Russia’s line on Georgia. “The Russians are definitely not happy with the results because the model they have always put forward is that Saakashvili is one thing and that the nation is another thing. They say: ‘get rid of Saakashvili and the Georgians and Russians will love each other’,” said Rondeli. “It’s a magic formula for them.” Now that the UNM has garnered 66 percent of the vote, it is unrealistic to draw a distinction between the leadership and the people.

Malashenko said that Georgia now finds itself at “crossroads.” As the Georgian president stamps down his authority domestically he can now focus more on the international stage. With Barack Obama’s administration showing less interest and relations with Moscow still in the deepest freeze, Saakashvili has started scratching around for new international partners. Unusually, so far Tbilisi’s sights seem to be set on two of the main regional powers: Turkey, Russia’s ever closer partner, and Iran, the United States’ sworn enemy.

A week ago the Georgian president revealed that Tbilisi and Tehran had agreed to scrap visas for travel between the two countries, and were actively seeking to boost mutual trade and implement cooperation on agriculture. Saakashvili stressed that relations with Iran would not sour its other important relationships, presumably referring to Washington. “We are not self-murderers. We’ll do everything that is rational,” he said. The Russians certainly would beg to differ on this last point. But what now seems clear is that the Saakashvili dynasty is here to stay, and if there is to be any progress in relations Russia will have to come to terms with Saakashvili or his UNM successor.

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